Lebanon: Selected Issues

IMF Staff Country Reports, October 17, 2019

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The Selected Issues paper studies the inefficiencies related to the electricity sector and assesses the potential impact of the 2019 reform plan.
Electricity shortages are the second constraint to competitiveness reported by businesses in Lebanon, based on the Enterprise Survey conducted by the World Bank.
Lebanon’s electricity sector performance is worse than other similar countries in the region.
Many businesses must rely on costly private generators.
Income inequalities are exacerbated by both the geographical disparities in Electricité du Liban’s (EdL) electricity provision and its tariff structure.
The most vulnerable households are the small consumers located in regions with little electricity provision from EdL.

A new electricity plan was approved by Cabinet on April 9, 2019 and ratified by Parliament on April 17, 2019.
It is critical that the plan is decisively implemented.
The plan should be enhanced further to fully restore EdL’s viability.

Introduce well-targeted measures, such as cash transfers, to help protect the most vulnerable households from the tariff increase.
As planned in the reform package, consumer tariffs should be indexed on the evolution of input prices to guarantee that tariffs will not be negatively impacted by future developments in fuel or gas prices.

Subject: Capital spending, Commodities, Economic sectors, Electricity, Energy sector, Expenditure, National accounts, Personal income, Tariffs, Taxes
Keywords: Capital spending, cost, CR, deficit, EdL's deficit, Electricité du Liban, Electricity, electricity bill, electricity provision, Energy sector, generation capacity, ISCR, Personal income, tariff structure, Tariffs

Lebanon: Selected Issues; IMF Country Report No. 19/313; August 21, 2019
- Lebanon: Selected Issues; IMF Country Report No. 19/313; August 21, 2019 (Markdown version)
- Lebanon: Selected Issues; IMF Country Report No. 19/313; August 21, 2019 (PDF)